Growth prompts cuts in Compaq staff layoffs

Growth prompts cuts in Compaq staff layoffs

Strong growth in the outsourcing management, network systems integration and multivendor customer services areas has prompted Compaq to reduce the number of jobs to be cut following the merger with Digital.

Compaq's human resources director, John Hannelly, said initial estimates of up to 400 positions being abolished had been reduced to a final figure of 225 due to the growth in business -- which includes the five-year multimillion dollar Optus Communications outsourcing deal won by Digital.

Hannelly said the final number of staff -- including contractors -- to be employed across the Australian and New Zealand merged enterprise was in the order of 2000.

"All of the staff redundancies are expected to be over by the end of October," he said.

These are likely to be finalised by the new 16-member management team headed by Ian Penman within the next two weeks or so. The areas most likely to be targeted include finance, human resources, product sales and management, manufacturing and logistics and administration.

Announcing the bulk of the new team recently, Penman said the merged entity had been restructured into three main segments -- sales and marketing, delivery, and support (which incorporates administration, human resources, legal and finance functions).

Hannelly claimed that the rate of attrition from the merged enterprise in Australia and New Zealand remained at less than 10 per cent -- despite the inevitable uncertainty and dissatisfaction over conditions surrounding such a significant upheaval.

He said that where there was overlap in the local manufacturing of desktop and lower-end servers, the lines would be rebadged as Compaq products in the fourth quarter of 1998.

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